Bitcoin ETF Hype Is “Moderating,” Says CoinShares
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European digital asset manager CoinShares claims Bitcoin ETF hype is slowing down despite the asset’s latest return above $71,000 per coin.
In a Monday blog post, the firm highlighted how the biggest Bitcoin funds are still posting sizable inflow figures – but smaller than they were at their peak in early March.
“Volumes last week declined to US$17.4bn for the week compared to US$43bn in the first week of March,” wrote CoinShares Head of Research James Butterfill.
Flows to digital asset products for the week totaled $646 million, the vast majority of which were to gain Bitcoin exposure over other cryptos.
Year to date, that figure rose to $13.8 billion – the highest amount ever, even surpassing the $10.6 billion inflows seen in 2021. Most of those flows have been absorbed by the handful of Bitcoin spot ETFs approved in January, which have soaked up $12.6 billion in net flows since launch.
The total volume traded by those ETFs in March surpassed $111 billion, shattering figures from the prior two months.
Spot Bitcoin ETF volumes soared to $111 billion in March, almost tripling the volume for the previous month, 👀 pic.twitter.com/FcMmsGFgfJ
— Crypto June 💎🎯 (@CryptoJune777) April 8, 2024
Much of that volume came in the form of sales from the Grayscale Bitcoin Trust (GBTC), however, which stands out as the only US Bitcoin spot ETF to experience non-stop outflows since launch.
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Unlike its rivals, the fund held much Bitcoin on behalf of early investors who have grown more interested in cashing out during Bitcoin’s price surge, now up 62% year to date. It also charges a much higher management fee than competitors, giving early buyers less incentive to enter the fund over other ETFs.
A similar trend is visible internationally. CoinShares’ data shows that Swiss and Canadian crypto funds lost $27m and $7.3m last week. Canada’s Purpose Bitcoin ETF – the first Bitcoin spot ETF in the world – has lost over 20% of its Bitcoin since BlackRock and Fidelity launched their equivalent products in January.
While overall flows continue for Bitcoin funds, short Bitcoin investment products saw their third straight week of outflows at $9.5 million.
Additionally, Ethereum experienced its fourth consecutive outflow week losing $22.5 million from related funds. Ethereum is yet to receive its own spot ETF, with experts growing less optimistic by the day that the current round of applications for the product will be approved by their deadline in May.
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